The outlook of the Application of Blockchain Technology on Fashion Collaborative Consumption from a Qualitative Perspective
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Systematic Literature Review
Generally, blockchain is identified as an open, decentralized and distributed database keeping records of digital transactions within a network of identical databases within a peer to peer connection that is potentially visible to each user within that particular network. Within the fashion industry blockchain technology has proven itself to be a strong guarantee for the information in their fashion transactions are not modified as they can easily track the orders. The decentralization achieved by the blockchain network has allowed the users, including customers, to develop trust towards all involved parties; hence transactions are undertaken by their peers. This has made the intermediaries obsolete who are very expensive whenever there are involved in the transactions.
Bullon Perez (2020) points out that the textile and clothing industry has not received extensive research in terms of collaborative consumption and specifically the use of blockchain technologies. Bullon Perez (2020) conducted research that was primarily a case study on women’s shirts from an apparel and fashion company that uses an open and private blockchain for traceability purposes. This research would find that blockchain technology ensured effective traceability among all the parties in the transaction. Fundamentally, the consumer was able to verify the origin and authenticity of the bought garment, which has been a significant feature of the present customer.
Currently, most prototypes and initial products are present in distinct domains such as the energy trading market places with specific interests within the European countries, notably, with blockchain-based marketplaces, the function of central authorities within markets has been reduced allowing the distributed creation and establishment of trust within a distributed fashion among the participants. Within this line of thought, the payments are also made off-chain hence decreasing blockchain’s role in trust and reputation. Also, incorporating the permissioned blockchain distributed ledger allows tracking electronic certificates of origin that are important to mitigate the risk of having forged declarations such as the origin of the fashion items. The electronic certificate of origin is tracked in all trade ages, serving as an authentic trade document for custom agencies and the importers.
The fashion industry understands that each item within its supply chain does have a long history. Notably, a significant part of this long history is the unethical practices that typically create financially crippling situations. Francisco & Swanson (2018) indicate that blockchain technology comes at an age where the current consumer is empowered such that they will require as much information as possible. This technology provides a high level of supply chain transparency that offers answers to client queries and substantial competitive advantage (Jordan & Rasmussen, 2018). This kind of beneficial technology will revolutionize the fashion industry in terms of customer expectations. With technology, the consumer becomes willing to collaborate with other parties to get the right product while communication flows seamlessly across the board.
As blockchain technologies continue to revolutionize the customer experiences in the fashion industry extensively and have them have higher expectations unconsciously, there are still challenges that need to be surpassed for the changes to occur. Saberi et al. (2018) indicate that blockchain technologies will help foster sustainability within the fashion industry when particular barriers in adoption are handled. These include the inter-organizational challenges, intra-organizational challenges, technical or system-related challenges and any external challenges. Each of these barriers affects blockchain technologies and their benefits that it is prudent to have countermeasures to mitigate them.
References
Bullón Pérez, J. J., Queiruga-Dios, A., Gayoso Martínez, V., & Martín del Rey, Á. (2020). Traceability of ready-to-wear clothing through blockchain technology. Sustainability, 12(18), 7491.
European Parliamentary Research Service. (2020). Blockchain for supply chains and international trade. Panel for the Future of Science and Technology. Retrieved from https://www.europarl.europa.eu/RegData/etudes/STUD/2020/641544/EPRS_STU(2020)641544_EN.pdf
Francisco, K., & Swanson, D. (2018). The supply chain has no clothes: Technology adoption of blockchain for supply chain transparency. Logistics, 2(1), 2.
Jordan, A., & Rasmussen, L. B. (2018). The role of Blockchain technology for transparency in the fashion supply chain.
Saberi, S., Kouhizadeh, M., Sarkis, J., & Shen, L. (2019). Blockchain technology and its relationships to sustainable supply chain management. International Journal of Production Research, 57(7), 2117-2135.
